Looking back on Phil Duff

By Simone Foxman

Wed Jan 22, 2014

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Absolute Return also revisits a call to “Leave Paulson alone!”


One year ago

John Paulson's Paulson & Co. was under fire after his flagship Advantage Plus fund dropped 21.42% in 2012, following a terrible 2011 in which the same fund lost 52.48%. "Oh, the horror!" cried financial journalists everywhere. Could this truly be the fate of the man who orchestrated "The Greatest Trade Ever"?

But, by last January, some were tired of the dog and pony show. There are plenty of other investors who managed more money in 2012 and did it better; why not pay them more heed?

A year later, the media circus has continued, but Paulson & Co. is on much more favorable ground. All of the firm's funds recorded gains this year-some whopping; the Paulson Recovery Fund ended the year up 63%. The Paulson Advantage and Advantage Plus funds generated returns of 33.5% and 32.38%, respectively. Even the worst of the bunch, the event-driven Paulson Partners Fund, beat our strategy benchmark, returning 18.4% compared to 14.51% gains for the Absolute Return Event Driven Index.

Two of the firm's funds-the merger-arbitrage focused Paulson International and the event-driven Paulson Recovery Fund-earned nominations for the 2014 Absolute Return Awards, which are based on risk-adjusted performance. Paulson & Co. was also nominated as "Management Firm of the Year" based on the overall risk-adjusted returns of its stable of funds. Winners will be announced on February 13 in New York City (details here).

Armel Leslie, a spokesman for Paulson & Co. at public relations firm WalekPeppercomm, declined to comment.

Five years ago

Greenwich-based Duff Capital Advisors laid off about 80% of its 100-person staff, adding to layoffs it had made in late 2008. The firm, which launched near the onset of the financial crisis, had struggled to raise capital despite founder Phil Duff's pedigree; he was previously the chief financial officer of Morgan Stanley, the chief operating officer of Julian Robertson's Tiger Management, and had founded FrontPoint Partners in 2001. Amid market turmoil, Duff Capital closed its doors in May 2009, according to various news reports.

In 2011, Duff resurfaced to launch Massif Partners, a multi-strategy hedge fund with the goal of building "the next generation asset management firm along the model pioneered by Phil Duff."

Multiple attempts to reach Massif directly were unsuccessful. A spokesman for Massif said the firm is still up and running as a private investment firm. 

ISSN: 2151-1845 / CDC10004H